European telecom giants Nokia and Ericsson have reported a significant drop in sales for the first quarter of the year, as Indian telecom operators slow down their 5G deployment. Nokia’s net sales declined by 68 percent to 265 million euros, while Ericsson’s net sales fell by 38 percent in its Southeast Asia, Oceania, and India market area.
The decline in sales can be attributed to the normalization of 5G investments in India after a period of rapid deployment. Pekka Lundmark, President and CEO of Nokia, noted that a slower pace of spending in India was expected after the initial surge in 5G deployment. Despite the decline, the company maintains its full-year expectations for India.
Both Nokia and Ericsson experienced record sales from their Indian operations until the third quarter of 2023. However, with customers becoming more cautious with their investments and the pace of investment in India normalizing, the companies anticipate further decline in the radio access network (RAN) market throughout the year.
The telecom vendors are also focusing on securing deals with struggling telco Vodafone Idea, which plans to expand its network infrastructure and set up new 4G and 5G sites. Vodafone Idea currently works with Nokia, Ericsson, Huawei, and ZTE for its 4G network. As the telco aims to cover a significant portion of its revenue base with 5G services in the next few years, it will be placing orders for network equipment once it secures funding.
While the sales decline in India poses challenges for Nokia and Ericsson, it also reflects the normalizing market conditions after a period of rapid 5G deployment. The telecom vendors remain optimistic about future opportunities in India’s evolving telecommunications landscape.
The telecom industry in Europe is facing challenges as Nokia and Ericsson report significant drops in sales for the first quarter of the year. This decline can be attributed to the normalization of 5G investments in India, where the companies experienced record sales until the third quarter of 2023.
Nokia’s net sales declined by 68 percent to 265 million euros, while Ericsson’s net sales fell by 38 percent in its Southeast Asia, Oceania, and India market area. Pekka Lundmark, President and CEO of Nokia, stated that a slower pace of spending in India was expected after the initial surge in 5G deployment. Despite the decline, both companies maintain their full-year expectations for India.
The decline in sales indicates the market’s normalization after a period of rapid 5G deployment. As customers become more cautious with their investments and the pace of investment in India normalizes, both Nokia and Ericsson anticipate further decline in the radio access network (RAN) market for the rest of the year.
To counter the sales decline, the telecom vendors are focusing on securing deals with struggling telco Vodafone Idea. Vodafone Idea plans to expand its network infrastructure and set up new 4G and 5G sites. Currently working with Nokia, Ericsson, Huawei, and ZTE for its 4G network, Vodafone Idea will be placing orders for network equipment once it secures funding. This presents an opportunity for Nokia and Ericsson to regain some momentum in the Indian market.
While the sales decline poses challenges for Nokia and Ericsson, it also reflects the normalizing market conditions in India after a period of rapid 5G deployment. Both companies remain optimistic about future opportunities in India’s evolving telecommunications landscape.
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